Rapid growth to drive small business hiring in 2016

Thursday 21 January 2016

A desire to expand their brand will encourage a large number of small businesses to hire more staff over the next 12 months, a new study has suggested.

The research, published by online jobsite Indeed, found that more than three-quarters (77 per cent) of small businesses plan to hire more people in 2016. However, they should be prepared for an increased staff turnover, the report warned.

According to the findings, many companies will be looking to grow in 2016, which could pose a problem for unprepared small businesses. The study warns that turnover will continue to be a problem for small businesses as they compete to secure the best talent in the market, with a more stable economy making many job seekers feel more confident about potential opportunities.

However, this isn't an issue that is unique to smaller companies, as most firms will be fighting to secure the best staff and consultants in 2016.

Tara Sinclair, chief economist at Indeed, said: "Small businesses have always competed for talent, but that will be more pronounced this year as companies of all sizes increase hiring."

While turnover is an issue, businesses say sudden growth is encouraging them to hire additional staff. According to the study from Indeed, nearly three-quarters (71 per cent) of small firms cite sudden growth as a reason to hire in the next six to 12 months.

It appears that many small companies are feeling confident about both the short and long term, with 42 per cent looking to hire at least word three people in the next three months.

In addition, more than half (54 per cent) need the support of consultants as they are recruiting to find new skills for their firm.

“We work with small businesses every day on their hiring needs, and we have seen an increase in job postings from our clients,” said Jason Whitman, senior vice president at Indeed. 

A recent report from the Federation of Small Businesses (FSB) showed that confidence is growing among small businesses, which could also help explain this sudden penchant for expansion.

Across the UK, the Small Business Index 2015 found that positivity had grown by 4.1 points from the last quarter of 2014.

However, in order to make the most of this optimism, small firms will need time to adapt to recent changes, such as the new living wage and pension auto enrolment rules outlined by the government recently.


By Victoria McDonnell

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